Shaping The Future Of AIM: Proposed Rule Changes For AIM Companies

The London Stock Exchange ("Exchange") has published a consultation paper setting out the most significant proposed overhaul of the AIM Rules for Companies to date. The amendments build on the Exchange's recent Feedback Statement, which highlighted support for differentiating AIM from the Main Market and reducing unnecessary regulatory burdens on admission and secondary fundraisings. These changes form part of the City's ongoing drive to improve accessibility to London's capital markets.

This article outlines the key proposed AIM rule changes and what they mean in practice.

What do the proposed AIM rule changes mean in practice?

The proposals centre on six strategic themes of direct relevance to AIM companies and their advisers:

• a lighter-touch admission process, including removal of the working capital statement;
• a new "Capital Access Window" (trading halt) to help manage equity fundraisings and support companies with broader investor participation, including retail investors;
• a more permissive regime for acquisitions, with the substantial transaction threshold rising from 10% to 25%;
• greater flexibility for founder-led businesses, including acceptance of dual class share structures;
• enhanced company agency over governance disclosure and third-party commentary; and
• streamlined routes for more international and Main Market companies to join AIM.

Taken together, the changes signal an intention to ensure AIM remains a competitive, dynamic and leading international growth market. Companies currently on AIM, and those considering a listing, should assess the practical implications. The key proposals are summarised below.

Reducing burdens on admission

The Exchange is working to redesign the AIM admission document, and the following changes are proposed with a view to simplifying the admission process:

Removal of the working capital statement

The Exchange proposes removing the requirement for directors to include a working capital statement in the AIM admission document. In its place, applicants will be required to clearly disclose certain details of their available capital resources, their financial obligations, and details of anticipated fundraising needs over the following 12 months. We will wait to see if this will make things easier for companies, or rather adds alternative obligations.

Expanded accounting standards

UK-incorporated AIM companies will now be permitted to use UK GAAP (FRS 102) instead of IFRS, and other local GAAPs may be permitted where IFRS equivalency is demonstrated. This could assist significantly with timing and cost given translation to IFRS can be burdensome.

Incorporation by reference

AIM companies will be able to incorporate information by reference in their admission documents, avoiding unnecessary duplication of readily available information. This will benefit companies, offering time and cost savings.

Lock-In arrangements

The Exchange has confirmed, whilst lock-in arrangements are a requirement under the AIM Rules, it does not have remit to enforce them, noting they are a contractual arrangement between the company and relevant parties. Permitted sell-downs will continue to be allowed in the first 12 months post-admission for transfers between spouses, intra-group transfers, and in cases of financial hardship.

Easier fundraisings

A new "Capital Access Window" will allow an AIM company undertaking an equity fundraise to voluntarily request a temporary suspension of trading, enabling it to manage the process more closely and approach a broader investor base, including retail investors. There will be no prescribed maximum duration and the Exchange will consider requests and terms on a case by case basis. Trading halts are used on other markets such as the ASX, and are considered important for maintaining market integrity but need to be carefully managed.

Supporting acquisition activity

Reverse takeovers

An acquisition will no longer be classified as a reverse takeover requiring readmission using an admission document solely because it exceeds 100% in the class tests; it must also involve a fundamental change to the company's business, board and/or voting control. Acquisitions exceeding 100% without such fundamental change will instead be treated as substantial transactions, potentially requiring shareholder approval.

Automatic suspension on announcing a reverse takeover in contemplation will no longer be required where the nominated adviser is satisfied that appropriate alternative disclosure can be made. This follows recent changes to the Listing Rules. A supplementary AIM admission document will not be needed where there is a delay between shareholder approval of a reverse takeover and completion, provided there is no significant new factor, material mistake, or material inaccuracy.

Substantial transactions

The class test threshold for determining whether a transaction constitutes a substantial transaction is proposed to increase from 10% to 25%, aligning AIM with the Main Market.

Flexibility for innovative and growing companies

A fair and reasonable opinion on non-standard director remuneration will no longer be required where the nominated adviser is satisfied that contractual terms provide reasonable commercial protections. This follows the currently undocumented policy approach taken. Where uncertainty remains, a shareholder vote will be required.

Special voting shares will be acceptable at admission, enabling founders to retain control through dual class share structures. We see this as a rebalancing approach as founder-led companies, particularly in the tech sector, often choose to list in the US where these flexibilities are already offered.

Greater agency for AIM companies

The "comply or explain" requirement against a particular corporate governance code will be removed. Instead, companies must use a recognised code as a framework and provide disclosure in five key areas: board composition; directors' roles and responsibilities; remuneration and performance; risk and controls framework; and approach to investor relations. In reality we expect most AIM companies to use the QCA code as their framework.

AIM companies will gain a voluntary "right of reply" to respond to third-party commentary, speculation, or criticism on bulletin boards and social media. Not exercising this right will not be construed as acceptance of any such commentary. It will be interesting to see how this will work beyond existing MAR obligations to prevent a false market.

Attracting international companies

Express market route

The current AIM Designated Market route will be replaced with a new "Express Market" route, opening AIM to companies from a wider range of jurisdictions via an accelerated admission process. The expanded list of jurisdictions will be based on IOSCO (International Organisation of Securities Commissions) principles. There will also be an accelerated admission process for certain Main Market companies.

Dual market route

A new dual market applicant admission route will be introduced for companies seeking simultaneous admission to an Express Market and AIM. Such companies will be able to rely on documents prepared for the Express Market admission and will be subject to limited additional content requirements, but must raise at least £6 million as part of an initial public offer. This £6 million fundraising requirement, after the application of an overseas exchange rate, may give some more junior companies a reason to think twice when considering using the dual market route. Contemporaneous dual listings have been very rare so we are not sure how this will playout.

Revised disclosure obligation (AIM Rule 11)

The current AIM Rule 11 disclosure obligation will be removed as duplicative of UK MAR. A new AIM Rule 11 will require AIM companies to engage with their nominated adviser on the potential market impact of business developments, supporting compliance with UK MAR obligations. The Exchange retains its powers to require disclosure under AIM Rule 22 and to make FCA referrals under AIM Rule 23. This is a good idea as it gives room for conflict between the Nomad's perspective of price sensitive information and the interpretation of inside information under MAR.

Our thoughts on the proposed AIM rule changes

We responded to the discussion paper which shaped the Feedback Statement on which this new consultation is based. As we commented on the previous consultation we agree with and welcome the changes such as the removal of the MAR duplication, the easing of the corporate governance reporting and the simplifying of the admission document. We are also pleased to see the opening up of the Express Market route for companies listed in other jurisdictions.

AIM is the original home for junior markets and it is good to see that the LSE intends to retain its leading position.

What should AIM companies be doing now?

Responses are due by close of business on 2 July 2026. We would encourage clients to assess how these proposals affect their businesses and to engage with the consultation where appropriate.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.